- 3.6% (£8.3 billion) of total benefit expenditure was overpaid due to fraud and error
- 1.4% (£3.3 billion) of total benefit expenditure was underpaid due to fraud and error
- the net loss to the Department for Work and Pensions, after accounting for recoveries, was 3.1% (£7.3 billion) of total benefit expenditure
Estimates of fraud and error levels in the benefit system in Great Britain in the financial year 2022 to 2023.
www.gov.uk
'This year’s Tax Gap, covering the 2020-2021 financial year, stands at £32bn, or 5.1% of tax liabilities. This is down from £34.4bn the previous year, which was also 5.1% of tax liabilities.
The amount of the Tax Gap resulting from fraud has increased from 43.7% to 45%, with the Tax Fraud Gap standing at £14.4bn.'
£bn 2021 2020 2019 2018 2017 Criminal Attacks 5.2 5.2 4.5 4.9 5.4 Evasion 4.8 5.5 4.6 5.3 5.3 Hidden Economy 3.2 3 2.6 3 3.2 Avoidance 1.2 1.5 1.7 1.8 1.7 Tax Fraud Gap 14.4 15.2 13.4 15 15.6 Total Tax Gap1 32 34.8 31 35 33 % of Tax Gap resultant from fraud 45.00% 43.68% 43.23% 42.86% 47.27% 1It...
www.taxwatchuk.org
So comparing like with like:
Benefit fraud
and error: - 7.3 billion.
Tax
fraud (not legal avoidance):- 14.4 billion. (In an earlier financial year.)
Which is a bigger problem?
If we somehow eliminated both, that gives us almost 22 billion. Against total central government expenditure of about 99 billion. (2023)
Government expenditure of £99bn? Not sure what that relates to - we spend more on benefits than that.
The tax gap is the sum of everything the government
thinks it would have received if standard rates of tax were applied and didn’t and breaks down like this:
The largest is £20bn from small businesses not paying their taxes correctly - a bit of cash in hand here, paying their staff cash in hand, a bit of charge you VAT and not pass it on. That sort of thing. We’ve all been quoted a cash figure before.
Criminals £4.1bn - likely smuggled goods such as fags and booze, perfumes etc and then being sold down the market.
Large businesses £3.9bn - these probably stem from trying to exploit the tax system - the government has clamped down on these in recent years and had quite a lot of success.
Mid size businesses £3.8bn - similar to large businesses.
Non wealth individuals- £2.1bn more cash in hand work.
Wealthy individuals £1.7bn - trying to hide their cash offshore or whatever - again the government has had a lot of success in recent years targeting this group.
Benefit fraud (fraud, not error, I deliberately excluded error from my numbers) stands per my post at ~£6bn
Legal tax avoidance stands at below £2bn (last was £1.7bn)
So the biggest problems (not the only but biggest) are paying folk cash in hand and benefit fraud. Those two alone stand at over £26bn. It’s funny people want to tar and feather Sunak for paying the legal amount of tax or demand the rich pay more but as soon as someone mentions benefit fraud or those that do cash in hand work - you know, our neighbours, part of the 99% in this country - people want to enter a game of whataboutery. You excluded because you’re actually a fairly decent and balanced poster.
This country is heading head long in to a fiscal crisis with the working population dwindling and drains on our budget (pensions) going skywards. The workers are going to rightly be questioning us FOC… so I need to pay more tax to fund your retirement and I can’t afford to get on the housing ladder (even less now due to having less cash due to increased tax) because you’re all sitting on the housing stock. We’re gonna be the first to go come the revolution.
Everyone needs to do their bit now and there is likely something a lot of us can do differently to help.
